Co-signing A Loan

I’m Miriam Neff, and I’m Valerie Neff Hogan, with Wise Women Managing Money.

M Here’s important financial advice, NEVER co-sign a loan.   If a bank won't loan someone money, then you shouldn't either, even if they're your child, boyfriend, girlfriend, needy relative or dear friend.

Valerie, as an attorney and certified financial planner, why is this so important?

Your signature means you are responsible for the debt if the person you co-signed for doesn't pay up. If they fall behind on payments your credit score could be damaged.  You are responsible permanently.

The reason THEY can’t get a loan on their own, is the same reason why you should not provide it. 

M I know it’s emotional, especially within families.

V   If you can’t give that money as a gift, bad idea.

M Good advice, Val.